Christopher R. DuncanMixed OutcomesThe Impact of Regional Autonomy and Decentralization on Indigenous Ethnic Minorities in Indonesia

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Mixed Outcomes: The Impact of Regional Autonomy and

Decentralization on Indigenous Ethnic Minorities in

Indonesia

Christopher R. Duncan

ABSTRACT

This article examines how indigenous ethnic minorities in Indonesia are be-ing affected by the implementation of decentralization and regional auton-omy policies. New legislation transferred responsibility and authority overvarious issues, including resource extraction and local governance, from thecentral government to regional authorities at the district level. Members ofthe growing indigenous rights movement hoped that this decentralization

process would allow ethnic minority communities to retain or regain controlover natural resources through local-level politics. Furthermore, some eth-nic minorities saw the implementation of decentralization as an opportunity

to return to local forms of land tenure and resource management that hadbeen disparaged by the national government for most of the twentieth cen-tury. However, these new laws also encourage district level governments togenerate income through natural resource exploitation, as they will receivea certain percentage of these revenues. Minority communities could be ad-versely affected as local governments disregard their land rights in efforts toraise income to cover their new expenses, essentially continuing the practicesof previous governments. This article examines the new opportunities, as wellas the new threats, posed by decentralization to ethnic minorities throughoutIndonesia.

INTRODUCTION

Indonesia began experimenting with a new form of decentralization at theend of the twentieth century, with the passage of new legislation that shiftedpolitical and fiscal authority from the national government in Jakarta tosub-provincial level governments throughout the country. This transfer ofauthority transformed one of the most centralized governments in the worldinto one of the most decentralized (World Bank, 2003b: 1). On the nationallevel, politicians and policy makers saw decentralization and regional auton-omy as a way to stabilize the country by making government more account-able to local populations and by addressing demands from regional leaders

Development and Change 38(4): 711-733 (2007). C Institute of Social Studies 2007. Publishedby Blackwell Publishing, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main St.,Malden, MA 02148, USA


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712 Christopher R. Duncan

that wanted more control over their natural resources.1 Communities fromresource-rich regions had long complained that the wealth generated by theirnatural resources had enriched politicians and their cronies in Jakarta rather

than benefiting local communities. Many saw regional autonomy as one wayto address this by returning control over most of these resources to regionalgovernments. Policy makers also thought that shifting authority and respon-sibility for numerous administrative functions to the local level would makegovernment more responsive to local concerns.

A large amount has been written about decentralization and regional au-tonomy in Indonesia, but most of the analysis has focused on the economicand political aspects of the legislation (Alm et al., 2001; Aspinall and Fealey,2001; Hadiz, 2004a), or its impact on natural resources, particularly in theforestry sector (Barr et al., 2001; Resosudarmo, 2005). Despite this vastamount of literature little attention has been paid to how this legislationcould affect indigenous ethnic minorities throughout the country. While thelegislation presents new opportunities for ethnic minorities, it also presents

new challenges and new threats.Onthepositive side,membersofthegrowingindigenous rights movement hope that this move towards regional autonomywill allow indigenous ethnic minority communities in Indonesia to retain, orregain, control over natural resources through local-level politics (Nababan,2002). Additionally, some ethnic minorities see regional autonomy as an op-portunity to return to local forms of governance, land tenure, and resourcemanagement practices that had been ignored or discouraged by the nationalgovernment during most of the twentieth century. However, the new fis-cal arrangements encourage district-level governments to generate revenuethrough natural resource extraction, as they will receive a large percentageof this income. The districts need these new revenues now that they are re-sponsible for a large portion of their own budgets, which have increasedsignificantly since the central government shifted numerous responsibilities

to the district level as part of the decentralization process. Unfortunately,the aggressive extraction of natural resources often works against the bestinterests of indigenous peoples as these resources (timber, minerals, and soon) are often found on their land.

Another aspect of decentralization, and one that remains under-examined,is the fate of small-scale indigenous ethnic groups, such as swidden agricul-turalists and forest-dwelling foragers, under regional autonomy. Numerousscholars (see, for example, von Benda-Beckmann and von Benda-Beckmann,2001: 78; Li, 2002) have noted the connection between decentralizationand the increase in localism, but few have looked at how this connection hasimpacted smaller indigenous groups that remain minorities after decentral-ization. Although calls for localism may benefit the larger group or groupsin a district, small-scale societies often do not share the same benefits. These

1. In the Indonesian context, the terms decentralization and regional autonomy are used inter-

changeably.


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Regional Autonomy and Decentralization in Indonesia 713

groups are often still peripheral to regional governance structures and remainlargely absent from the local political hierarchies and bureaucracies that willmake decisions in newly decentralized districts. However, these same groups

often occupy land rich in natural resources. Thus regional autonomy will mostlikely benefit certain larger indigenous ethnic minority groups, while con-tinuing, and in some cases accelerating, policies that work against the bestinterests of smaller groups. In what follows, I examine the contradictory im-pacts of the new regional autonomy legislation on this particular sub-set ofethnic minorities, looking at examples from the literature, as well as frommy own field research on the eastern Indonesian island of Halmahera in theprovince of North Maluku.

THE PROMISES OF DECENTRALIZATION

Decentralization refers to the process in which central governments transfer

political, fiscal and administrative powers to lower levels in an administrativeand territorial hierarchy. This process has become popular throughout theworld over the last several decades. In Southeast Asia, several countries haveundertaken new plans to decentralize government authority (Arghiros, 2001;Bird and Rodriguez, 1999; Blunt and Turner, 2005). These efforts have beenvigorously supported by multi-lateral institutions such as the World Bank andthe Asian Development Bank (i.e. World Bank, 2005). This support stemslargely from the idea that decentralization will promote better governance aslocal officials are supposedly more aware of, and more responsive to, localneeds (Ribot, 2004: 11). Proponents of decentralization also argue that it willencourage the growth of democracy as local citizens are provided with morecontrol over their own governance (Crook and Manor, 1998; Manor, 1999).As communities participate in local politics, governments will become more

accountable to their constituents. Enhanced accountability, it is argued, willlead to better policy and less corruption (Agrawal and Ribot, 1999). 2 It isalso claimed that decentralization will improve natural resource management(Kaimowitz and Ribot, 2002). They contend that local communities livingin direct proximity to the environment under exploitation will be more likelyto adopt sustainable resource management practices than outsiders.

A further incentive to decentralize is the belief that the interests of ethnicminorities and other marginal groups within the state are better protectedas local communities gain more control over their own affairs (Kaimowitzet al., 1998; Kalin, 1999). However, others contend that decentralizationallows local elites to capture more benefits while still excluding ethnic mi-norities and other vulnerable populations from the political process (Hadiz,2004a; Resosudarmo, 2005). As Ribot (2004: 23) notes: Even perfectly

2. Whether decentralization increases or decreases corruption remains a matter of debate (Bardhan

and Mookherjee, 2000; Fisman and Gatti, 2002).


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representative and downwardly accountable local authorities may over-exploit resources and ignore minority interests if given the unbridled powerto do so. These regional elite have little inclination to include ethnic mi-

norities in the political process as their loyalties and future election hopesare often tied to majority communities that might have different needs anddesires than local minorities.

Whether decentralization policies have helped indigenous ethnic minori-ties remains open to debate. Some authors argue that indigenous ethnic mi-norities have benefited from the new arrangements that arise from decentral-ization, while others have noted the failures. The case of Bolivia representsa good example. Kaimowitz et al. (1998) claim that decentralization allowedBolivias indigenous minorities to gain more control over their land and overgovernance. In contrast, Beneria-Surkin (2004: 3, 7, cited in Hughes, 2005:30) found that indigenous communities fared poorly under Bolivias decen-tralization policy, due in large part to their inability to take advantage ofthe political space opened up by decentralization. Although decentralization

provides new opportunities for ethnic minorities to participate in local poli-tics, they are often still excluded from the decision-making process. In manyplaces continued discrimination against indigenous minorities, based in parton the belief that they are incapable of effective governance, continues tohamper their participation in decentralized politics. In Vietnam, a UNDPstudy (2006: 356) found that the widely held prejudice that ethnic minori-ties have low capacity and a low intellectual level has been a significantobstacle to increased minority participation. Thus, although decentraliza-tion shifts authority to lower levels of government, it does not always lead tothe equal inclusion of all indigenous peoples.

INDIGENOUS PEOPLE AND ETHNIC MINORITIES IN INDONESIA

The topic of indigenous people and ethnic minorities has always been a trickyone in Indonesia. The Indonesian government has a strict policy of not offi-cially recognizing ethnicity in government discourse or policy making. Callsfor preferential treatment by groups claiming status as indigenous peoplewere discouraged, if not explicitly forbidden, for most of Indonesias post-independence history. The government argues that the international legalcategory of indigenous people is not applicable to the nation, as almostall Indonesians (with the exception of the small Chinese community) areindigenous. For example, there is no official body for dealing with indige-nous people, or tribal people as there is in Malaysia or Vietnam, nor doesthe government recognize certain ethnic groups as having special legal priv-ileges based on their indigeniety. Special recognition of this type would be

considered unconstitutional since all Indonesians are guaranteed (in theory)the same rights. The government does have a programme aimed at devel-oping certain groups that it considers to be lagging behind the mainstream,


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such as forest-dwelling foragers and swidden cultivators. The governmentrefers to such groups as geographically isolated customary law communi-ties (komunitas adat terpencil), but being labelled as such is not associated

with any particular legal category (Duncan, 2004).The governments stance on issues of indigeniety hindered the develop-ment of an indigenous peoples movement during the reign of PresidentSuharto (196798, often referred to as the New Order). In the 1990s, how-ever, as international aid agencies began to pay more attention to the plightof indigenous minorities throughout the world, local groups in Indonesia be-gan organizing and in 1999 founded the Alliance of Indigenous Peoples ofthe Archipelago (Aliansi Masyarakat Adat Nusantara, or AMAN). AMANseeks to represent indigenous peoples as they attempt to gain recognitionand land rights from the government. AMAN defines indigenous peoplesas communities which have ancestral lands in certain geographic locationsand their own value systems, ideologies, economies, politics, cultures andsocieties in their respective homelands (Down to Earth, 1999). Although

still problematic, the foundation of AMAN marks an organized effort tostrengthen the position of those politically marginalized groups that wereharmed the most (and victimized) by the politics of development overthe last three decades (AMAN, n.d.: 2). These groups include the Sakaiand Orang Rimba of Sumatra, the various Dayak groups and the Punan inKalimantan (Indonesian Borneo), and numerous groups in Papua, to namejust a few.

These small-scale societies on the political margins of Indonesia wereamong the communities most adversely affected by the natural resourcepolicies of the Indonesian state prior to 1998. These groups often lived onland that was needed for natural resource extraction, plantation expansion ortransmigration. Officials and bureaucrats usually saw them as obstacles todevelopment, which needed to be removed. Along these lines, the Indone-

sian government passed numerous pieces of legislation such as the BasicForestry Act of 1967, the Basic Mining Act of 1967, and the Basic AgrarianLaw of 1969 that placed the rights of the state and national develop-ment ahead of the rights of individual communities. For example, the BasicForestry Act of 1967, although recognizing the existence of locally ownedforests, stated that local communities could not obstruct the implementationof government development agendas. Furthermore, in the 1980s, in what hasbeen called one of the largest land grabs in history, the national governmentclassified over 75 per cent of the nations land as State Forest, essentially tak-ing land away from local communities and putting it under state control (Fayand Sirait, 2001: 126).3 Government officials saw individuals or commu-nities who contested the seizure of their land as agitators working againstthe best interests of the nations development by government officials, rather

3. Recent legal court cases in Indonesia are challenging the legality of these claims, see Contreras-

Hermosilla and Fay (2005: 1016).


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than victims seeking just compensation for their losses. These agitators wereeither jailed or intimidated with threats of violence (Human Rights Watch,2003). The allocation of logging or mining concessions and the demarcation

of transmigration sites and plantations was usually done without the consul-tation of the people who lived in these supposedly empty spaces. Their rightsand needs were disregarded and subjugated to those of industrialists, loggers,and others who were connected to the Suharto family, their cronies, or themilitary. These connections enabled certain individuals to acquire land at afurious rate, while making it difficult for indigenous minority communities(as well as other marginalized communities, such as farmers in Java or Bali;see Bachriadi and Lucas, 2001) to hold on to their land.

The cultural policies of the Indonesian government during the Suhartoregime also threatened the continued survival of many small-scale ethnicgroups. Many government officials considered these groups backward andprimitive people who needed to be brought into mainstream Indonesiansociety. To facilitate this process the government had several programmes

aimed at developing these groups. One of the more notorious was theProgramme for the Development of Social Prosperity of Isolated Societies(Pembinaan Kesejahteraan Sosial Masyarakat Terasing) renamed the Pro-gramme for the DevelopmentofSocial Prosperityof Geographically IsolatedCustomary Law Communities (Pembinaan Kesejahteraan Sosial KomunitasAdat Terpencil) in 1999. This programme sought to incorporate such groupsinto the nation-state through a five year period of social engineering thatattempted to change various aspects of a groups culture, such as agricul-tural techniques and religious beliefs, and included (often forced) resettle-ment. For example, on the island of Halmahera in eastern Indonesia, officialsused this programme to justify the resettlement of numerous forest-dwellinggroups into coastal communities, often against their will. The governmentthen took their land for state-sanctioned development projects (Duncan,

2002).The national government also passed legislation aimed at eroding thetraditional heritage of local communities. The 1979 Law on Village Ad-ministration standardized village government across the archipelago andreplaced local systems of community governance with a Javanese model.4

Local customaryleaders weremarginalizedorremoved, and individuals moreamenable to state rule were installed in their place. Harwell and Lynch (2002:27) refer to the law as the most crippling assault ever on village authority inIndonesia. Village leaders became civil servants responsible to the centralgovernment rather than to the local population (Antlov, 2003). They had littleinterest in maintaining traditions that did not benefit them, and in some caseseven called into question their legitimacy (Bartels, 2003: 139). This law alsohad a negative effect on the ability of many ethnic minorities to preserve local

systems of land management and resource use. Local leaders who formerly

4. Law 5/1979 on Village Administration.


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oversaw resource use allocation and land management lost their authorityto village heads who now implemented policies based on national directivesthat often showed little concern for sustainability or local needs. The Law on

Village Administration and the above-mentioned laws on natural resourceextraction have all been either repealed or substantially altered by the newregional autonomy legislation.

DECENTRALIZATION IN INDONESIA

The Indonesian governments plan for decentralization, despite being rathervague and not well thought out, has been very ambitious. It has includedplans for the transfer of both fiscal and political responsibility from Jakartato over 400 districts and municipalities. The process initially centred aroundtwo pieces of legislation: Law 22/1999 on Regional Governance and Law25/1999 on the Fiscal Balance between the Central Government and the

Regions. These laws were pushed through the legislative branch immedi-ately after the fall of President Suharto in 1998 by his replacement PresidentHabibie. The national government passed the legislation, in part, to mollifyregional leaders who were tired of centralized rule from Jakarta and wantedmore say over their own governance and their own resources. Habibie alsohoped that the quick passage of such legislation would help to create a con-stituency in the outer provinces to help his (ultimately cancelled) bid forre-election. The legislation bypassed the provinces and transferred authorityfrom the central government directly to districts (kabupaten) and municipali-ties (kotamadya), the level of government directly below that of the province.Legislators hoped that transferring power to the districts and municipalitieswould make government more responsive to local communities and placatethe critics of centralized rule. They also thought that bypassing the provin-

cial level of government would curtail separatist tendencies that are moreprominent at that level (particularly in places like Aceh and Papua), some-thing that had hindered earlier efforts at decentralization. Furthermore, thegovernment would have more control over the smaller districts than it wouldover larger, more powerful provinces.5 The central government passed thelaws so quickly that they lacked clarity and were rife with contradictions andinconsistencies (Bell, 2001). As a result, both laws were amended with thepassage of two revised laws on regional autonomy in 2004. Law 32/2004on Regional Administration replaced Law 22/1999, and Law 33/2004 on theFiscal Balance between the Central Government and the Regional Govern-ments replaced Law 25/1999.6 For the focus of this article, minority rights,

5. Theaveragepopulationofdistricts/municipalities is500,000,butitrangesfrom120,000inmore rural regions to 3.5 million on Java.

6. Thetworevisedlawsonregionalautonomyarenottheonlypiecesoflegislationthat affect theprocess of decentralization. Numerous other regulations and laws from both


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the substantial change was in the Law on Regional Governance that now callsfor the direct election of the district head or mayor.7

The legislation on regional governance, Law 22/1999 (subsequently re-

placed by Law 32/2004), transferred political control to the many districts(kabupaten) and municipalities (kotamadya) across the country. These re-gional governments have been given authority over areas such as health,education, village governance, land tenure, trade, environment and resourceextraction.8 The national government remains responsible for national de-fence, international relations, justice, security, religion, and monetary poli-cies. Along with these new authorities and obligations the central governmenttransferred a large number of civil servants (and the responsibility to pay theirsalaries) to regional governments. To understand the magnitude of this shiftin authority, the World Bank notes that over 2 million civil servants, as wellas 239 provincial-level offices of the central government, 3,933 local-leveloffices, and more than 16,000 service facilities schools, hospitals, healthcentres were transferred lock stock and barrel to [over 400 plus] regional

governments throughout Indonesia (World Bank, 2003b: 1).The second aspect of regional autonomy, Law 25/1999 (subsequently re-placed by Law 33/2004 of the same name) on the Fiscal Balance between theCentral Government and the Regions, provides for, among other things, theredistribution of natural resource revenues to the district level. The districtsnow receive a certain percentage of revenues generated by the exploitationof natural resources, particularly oil, natural gas, timber and mining (seeAppendix Table A1). Officials hoped this legislation would address long-term resentment from resource-rich regions that were angered over perceivedoutflows of wealth to Jakarta, particularly Aceh and Papua. In fact the lattertwo provinces were given their own regional autonomy laws with a differ-ent distribution of resources. According to Law 21/2001 on Special Auton-omy for the Province of Papua, the provincial government of Papua receives

70 per cent of the revenue from oil and gas exploitation for the first twenty-five years, after which the revenues will be 50 per cent for oil and 40 percent for natural gas.9 The province of Aceh will receive 80 per cent ofthe revenues from oil and gas for an eight year period, and then the rev-enue will be reduced to 50 per cent. 10 The other aspects of revenue sharingare similar to other provinces. The new legislation also gives all districts

Jakarta and district capitals can affect how decentralization is subsequently enacted at the local

level. These include implementing regulations from national-level ministries and from district-

level governments. Often these regulations depart from the spirit of the original

decentralization legislation (Antlov, 2003: 201). The implementation of regional autonomy is

also affected by (often contradictory) existing sector laws and regulations from ministerial

departments, such as the Department of Forestry.

7. Law32/2004:article24,paragraph5.

8. Foramorein-depthdiscussionandanalysisseeWorldBank(2003b).9. Law21/2001onSpecialAutonomyfortheProvinceofPapua:article34,paragraphs26.10. Law 18/2001 on Special Autonomy for the Special Administrative Area of Aceh as the

Province of Nanggroe Aceh Darussalam: article 4, paragraphs 35.


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and municipalities in Indonesia the authority to implement new taxes andfees to raise revenues. At the same time that these regions received controlover these new sources of income, they also accepted responsibility for a

significant portion of local expenditures previously covered by the centralgovernment.11

Local Participation and Indigenous Ethnic Minorities

One of the main selling points for decentralization was that it would al-low for stronger local participation in government as older patterns of cen-tralized rule from Jakarta were discarded. Local communities now have anopportunity to play a larger role in shaping and implementing policy that di-rectly affects them. Regional leaders (the district head, bupati, or the mayor,walikota) are now directly elected by their constituents (albeit from a list ofcandidates selected by political parties) rather than being appointed by the

Department of Interior Affairs in Jakarta.12

Thus, in theory, regional leadersare now accountable to their constituents, rather than to the central gov-ernment. Even village heads are now, technically, more accountable. Priorto the new legislation, village heads were approved by higher administra-tive levels and were responsible to those officials. Now they are elected bythe community and must report to a Village Representative Board (BadanPerwakilan Desa) made up of local citizens who evaluate their work.13 Advo-cates of indigenous rights hope that this new level of accountability will pro-vide ethnic minorities with a greater say in influencing policy decisions thataffect them.

The new autonomy provided by decentralization gives regional leadersthe ability to turn down large-scale development projects that they considerharmful to the best interests of their constituents. For decades, decision mak-

ers in Jakarta implemented development plans throughout the country with-out taking notice of local interests. One result was a frequent lack of concernfor the rights and well-being of ethnic minorities as the state took theirland for large-scale development projects, such as transmigration, timberconcessions and plantations. One of the most egregious examples of na-tional development priorities that disenfranchised ethnic minorities was theMillion-Hectare Peat-Swamp Project in Central Kalimantan. This projectsought to transform over one million hectares of peat swamp into a rice-based transmigration settlement for 1.5 million migrants. The indigenous

11. The numerous other aspects of Law 33/2004 that affect the fiscal relationshipbetweenJakarta and the districts are beyond the scope of this article. For more details on these new

arrangements, see Hofman et al. (2006).

12. Law32/2004onRegionalAdministration: article24,paragraph5;alsoarticle56,paragraph57.

13. Law32/2004onRegionalAdministration:articles203210.ForagoodanalysisofhowtheVillage Representative Board works, see Ito (2006).


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Dayak people who lived in the project area saw their livelihoods largelydestroyed. The project turned productive gardens, forests and other commu-nally and privately held lands into one of the most desolate spots on earth

a vast, stinking, blackened, smouldering and toasted place (Vidal, 1997cited in Barber and Schweithelm, 2000: 34). Dayak communities received nocompensation from the government other than promises of inclusion in theultimately failed project. Unfortunately, examples such as this were commonduring the last decades of the twentieth century. The central government con-sidered sparsely populated regions outside of Java as empty places openfor development, rather than taking note of local people or local land-usesystems. The new regional autonomy legislation allows district governmentsto refuse such projects, a major step forward in the ability of local peopleto reclaim, or defend, their land rights. Regional autonomy also allows localcommunities within a district to fight projects proposed by the district gov-ernment. The ability to reject development plans devised at the national andregional level provides ethnic minorities (and others) with more control over

their future than they had under previous regimes.The new autonomy provided to villages also presents ethnic minorities withan opportunity to return to local forms of customary rule. Older laws requir-ing a standardized form of village administration throughout the archipelagohave been repealed and villages can now choose to implement forms ofgovernment based on local custom (adat). After decades of being ruled bynational legislation that often disregarded local beliefs and customs as ahindrance to development, some ethnic minority communities hope that arevitalization ofadatwill allow for more nuanced governance that pays atten-tion to local needs and local culture. Regional autonomy has allowed someregional governments to pass legislation that recognizes the legitimacy ofindigenous institutions for local governance, such as in the province of WestSumatra and the district of Tana Toraja (South Sulawesi). 14 Furthermore, the

legislation in West Sumatra, where the majority of the population are fromthe Minangkabau ethnic group, noted that the Mentawai, an ethnic group thatinhabits the Mentawai Archipelago off the coast, have a different adatandculture and gave them an opportunity to create their own governance system(Eindhoven, 2003: 47). In another example, the district government of Lebakin the province of West Java passed a regional government regulation thatrecognized the collective rights of two groups of the Baduy ethnic group.15

This legislation recognizes the Baduy as a distinct community, and allowsthem to govern their land based on their own custom (Colchester et al., 2003:260).

14. West Sumatra Province Regional Government Regulation 9/2000 on Guidelines for theReturn of Village Government to the Traditional Nagari System, and Tana Toraja District

Regional Government Regulation 2/2000 on Lembang Government.15. LebakDistrictRegionalGovernmentRegulation32/2001Protecting theTraditionalCom-

munal Land Use Rights of the Baduy People; see also Koran Tempo (2002).


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The ability to control access to their land has enabled some communitiesto profit from businesses that need access to that land. After decades of re-ceiving little, if any, benefit from extractive industries, local communities

can now demand compensation from companies seeking use rights. Timbercompanies, mining companies and others must co-operate with local peo-ple, at least superficially, or be denied access. Many local communities nowrequire numerous promises from timber companies, such as jobs, money,and agricultural inputs before they grant permission to begin logging. Forexample, a 20034 survey of sixty-five communities in East Kalimantanfound that the number of households per community that received financialbenefits from logging had increased significantly from 1 per cent beforedecentralization to 94 per cent afterwards (Palmer and Engel, forthcoming).However, results from this same study showed that although most communi-ties were receiving benefits, others continued to lose their land and resourcesfor minimal financial compensation (Engel and Palmer, 2006: 444). As aresult, although communities are now able to receive some level of compen-

sation (more than they did under previous regimes), the majority of profitsstill go to regional elites and the companies involved in resource extraction(Resosudarmo, 2005). Access to community forests is often granted by par-ticular individuals or particular factions rather than the entire community,which can lead to conflict within villages (McCarthy, 2004: 121011). Fur-thermore, some research has shown that decentralization has also increasedconflicts between ethnic groups with competing claims over land and naturalresources (Sudana et al., 2004).

Although many ethnic minorities are faring better under decentralization,groups that became minorities due to redistricting, or that remain minoritieswithin anexisting district, arenobetter off, and in some cases are doing worse.Decentralization can often strengthen pre-existing power relations in caseswhere traditionally marginalized people are unable to organize (Crook and

Manor, 1998: 302). In places such as Kalimantan, many politically powerfulDayak groups have been doing well since the implementation of regionalautonomy. They have been able to regain control of land and resources thatthey had lost under previous governments. However, this is not the case foreveryone. For example, the Punan, a group of forest-dwelling foragers inKalimantan, generally do not fare as well as other Dayak groups. They arestill a minority group and are often unable to organize or gain any politicalpower (due in large part to this lack of political organization). As new rightsand monies are being distributed, the Punan are often forgotten or in somecases outright ignored (Wollenberg et al., 2006: 428).

The Forest Tobelo, a small group of forest-dwelling foragers on the easternIndonesian island of Halmahera, provide another example of a group notfaring well under regional autonomy. They have long been the subject of

development efforts by the national and provincial government (Duncan,2002). However, these development efforts were often aimed at removingthem from land needed for timber plantations, transmigration or forestry


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concessions, rather than actually improving their socio-economic conditions.In 2002 local elites claimed that under regional autonomy the Forest Tobelowouldnolonger lose their land todevelopment projects. Unfortunately, recent

initiatives show that the system continues to work as it always has and plannedresettlements of Forest Tobelo groups are going ahead as their land is takenfor other developments. Furthermore, future forestry and mining proposals,often accelerated due to decentralization, threaten the last remaining forestsin which they live. The Forest Tobelo, like the Punan, remain unable to contestthese moves due to their lack of political organization and political powerand their continuing lack of presence in the bureaucracies that make thesedecisions.

Another problem facing some ethnic minorities, particularly those whohave been resettled, is that they do not live in autonomous villages, but inhamlets (dusun/anak desa) under the jurisdiction of a larger village, oftenof a different ethnic group with whom they have limited ties. As a result,the village head can now legally give away the rights to their land in the

name of regional autonomy. For example, in Halmahera most Forest Tobelosettlements are technically under the jurisdiction of neighbouring villages. Inone particular case a Forest Tobelo communityisnow under the jurisdiction ofa neighbouring village of government-sponsored migrants who are primarilyfrom the Bicoli ethnic group. These Bicoli migrants live on land that thegovernment took from the Forest Tobelo in the 1980s to build a transmigrationsettlement. The migrants have long had their eyesonremaining Forest Tobeloland and have never been shy about stating those desires. Now that the ForestTobelos land is technically under Bicoli jurisdiction as part of their village,the Bicoli can control how it is allocated for development projects, suchas selling timber rights, allowing gold mining, or giving away the land forplantations. History shows that these decisions will most likely be madewithout Forest Tobelo consultation and without concerns for their future. This

situation is not unique to this village in Halmahera, but occurs throughoutthe archipelago.

Decentralization, Natural Resources and Corruption

The benefits of new local controls over development projects and naturalresource extraction created by regional autonomy are almost immediatelyoffset by the new fiscal responsibilities of regional governments. Althoughthe central government still provides a large amount of money for districtbudgets, the regions have been given responsibility to cover a certain percent-age of civil servant salaries, as well as other costs. Thus just as the districtshave been granted the authority to turn down timber, mining and planta-

tion projects that conflict with local interests, they now need and desirethe income that these projects can generate. Issuing new permits for logging,mining, or plantation expansion presents a quick and easy way to fill regional


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coffers for newly elected politicians. The almost millenarian hopes that manyhave placed on the promises of regional development have increased thepressure to raise funds. Newly elected local elites may feel compelled to

deliver on election promises, and their constituents are eagerly (often im-patiently) waiting for such fulfilment. Thus even though transfers from thecentral government often equal the expenditures they previously covered,district level officials need even more funds for infrastructure developmentand to pursue new projects (Brodjonegoro, 2004: 9). These desires for rapiddevelopment are often coupled with a lack of expertise at the local levelto develop long-term management plans for the exploitation of natural re-sources. The danger is that regional leaders will choose short-term growthover long-term sustainability. Ethnic minority communities could be ad-versely affected by such moves, as local governments disregard their landrights in efforts to raise income to cover government expenditures and petprojects.

Politicians also tend to side with business interests over those of local

communities, particularly in the area of the natural resource exploitation andplantation expansion (Djogo and Syaf, 2003: 1617). In their quest to raiseincome (both for their districts and for their own pockets) local politicianseagerly seek businessmen to invest in their districts and often offer up theirnatural resourcesasanenticement. However, these natural resources are oftenclaimed by indigenous minorities or in some cases the rural poor, who cannotdefend their claims against an entrenched regional elite. These communitiesare only briefly consulted, if at all, before district-level civil servants anddistrict-level assemblies (DPR-D) approve these projects. For example, inthe district of North Halmahera district officials and elected members of theDPR-D are considering a plan that will convert large swathes of the districtsinterior into oil palm plantations. These plantations, managed by a numberof Jakarta-based conglomerates, would appropriate large tracts of land from

several indigenous minorities, including Pagu, Modole and Forest Tobelocommunities. Some communities would be engulfed by the plantations andwould lose virtually all of their forest land and gardens, which would beconverted to oil palm. Discussions of these plans focus on the income theycould generate for district budgets, rather than the welfare of the people whowould lose their land and their livelihoods.

The detrimental effects of regional autonomy on natural resource man-agement have been examined in-depth in the forestry sector. In general,the process of decentralization has led to an increase in illegal logging.McCarthy (2001: 22) notes that decentralization does not completely explainthe rise in illegal logging: the increase began during the monetary crisis of1997 and continued during the chaos following the fall of Suharto in 1998.Decentralization will, however, make it harder to stop. Local officials, un-

concerned with the long-term forestry planning undertaken in Jakarta, mayseek to exploit this illegal logging as a source of income rather than attempt-ing it control it. For example, in a district in Central Kalimantan, rather than


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trying to stop illegal timber operations, the district head decided to tax theshipments of illegal logs that passed through his district to produce more rev-enue. While producing a new income stream for the regional government, he

essentially legalized illegal timber shipments (McCarthy, 2001: 1114). Thedecentralization of natural resource management has led to a frontier-likeatmosphere in the outer regions of Indonesia, which is hastening resourceextraction and negatively affecting the ability of many ethnic minorities tohold onto their land and resources.16 Furthermore, the legal uncertaintiesthat now surround the extraction of natural resources, particularly timber,have provided opportunities for district-level leaders to engage in illegal orextra-legal logging and to argue for their legality. These uncertainties aboutjurisdiction and rights over forests currently prevent national level authoritiesfrom enforcing national laws.

One of the most frequently cited negative impacts of decentralization hasbeen an expected rise in corruption throughout the country. Although Indone-sia is well known for its corruption, prior to regional autonomy large-scale

corruption was limited to a small number of people in Jakarta and in provin-cial capitals, who had decision-making authority and family connections.Decentralization now provides local elites with access to these income flows.As one official in North Maluku noted corruption will be decentralized justlike everything else. The new power of regional officials, coupled with asurge in income due to natural resource extraction, may prove a temptationfor many (Djogo and Syaf, 2003; Simarmata, 2002). Efforts by corrupt politi-cians to maximize their income could lead to policies that are detrimental tothe well-being of ethnic minorities, such as rapid forest conversion and thealienation of their lands for large-scale development projects. Ethnic minori-ties could lose their land rights or use rights as enterprising individuals sellthem to the highest bidder. Whether the total amount of corruption has ac-tually increased since decentralization remains a matter of debate. 17 Public

perceptions about the correlation between decentralization and corruptionvary throughout the country. The general consensus in North Halmahera isthat the amount of corruption has remained approximately the same, but itis significantly more visible now as it is going to local people who spendit on conspicuous consumption. A popular joke explains that the acronymDPR, which stands for Dewan Perwakilan Rakyat (Peoples Consultative As-sembly) actually means they improve their houses (North Moluccan Malay,dorong perbaiki rumah). The joke refers to the large amount of expensivehome improvements that virtually all members of the DPR-D have had made

16. Foragooddescriptionofthisfrontieratmosphereanditseffectonlocalcommunities,seeTsing (2004: 3345).

1. Studiesoncorruptionundertakensincedecentralizationhavefocusedonperceptionsofcor-ruption (World Bank, 2003a: 47) or on narrow aspects of corruption that do not necessarilyapply to the more rural districts where most indigenous ethnic minorities live (Henderson and

Kuncoro, 2006).


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16. Regional Autonomy and Decentralization in

Indonesia

725

since they were elected, many of them well beyond the means of their officialsalaries.

Bureaucrats in Indonesia have shown a tendency to put their own interestsabove those of their constituents, particularly the most marginalized ones.As regional assemblies (DPR-D) have more independence and more controlover their finances they can allocate money as they see fit. For example inthe district of West Lombok, the government allocated more than 3.3 billionrupiah (approximately US$ 350,000) towards the purchase of luxury cars andmotorbikes for district officials in fiscal year 2002. In contrast, they allocatedno money towards village development funds, because they forgot about it(Mawardi et al., 2002: 11). This type of corruption hurts ethnic minorities,as well as others, in that they tend to live in more rural areas, which areusually the first to lose services as budgets are adjusted to pay for the perksof local bureaucrats. Thus even if the profits from corruption are investedlocally, they are not helping rural ethnic minorities. The money that corrupt

officials use for conspicuous consumption, home improvements, or travelmay help the incomes of carpenters and other urban tradesmen, but it rarelyreaches the ethnic minorities in the rural hinterlands whose lands and forestsare often what generated those funds.

Elected members of the DPR-D and the district head/mayor can get awaywith corruption and at times govern against the best interests of their con-stituency for several reasons. The continuing predominance of political par-ties in the electoral process, as stipulated in the decentralization legislation,virtually ensures that candidates are more accountable to their party than totheir constituency. In elections for regional assemblies, there are no indepen-dent candidates. People may vote for an individual from a particular politicalparty seeking to be elected to a regional assembly, but the political partiescontrol, to a certain degree, how these votes are apportioned and which can-

didates are installed.18

Although the district leader is now directly elected,he must have the support of a recognized political party to run for office.Obtaining such support can be very expensive and requires large amountsof capital. Businesses leaders and others often provide this capital but thenexpect favouritism (appointments to lucrative posts, state contracts, and soon) once the candidate has been elected. The subsequent debt to these busi-nessmen and others can prevent district heads from implementing reform orremoving corrupt leaders. Individuals who have widespread support outsideof political parties may be excluded from contesting elections simply be-cause they cannot afford to purchase the nomination from a political party.Furthermore, political parties are not likely to select candidates who mightimplement reform or try to curb corruption.

Hadiz (2004b: 620) points out that the continuing prominence of polit-

ical parties has allowed many old national and local predatory elites to

18. See IFES Indonesia (2003) for a detailed explanation of how seats in the regional assemblies are

distributed by votes and by parties.


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re-position themselves in local politics. Thus many of the new regional of-ficials (district-heads and mayors) as well as members of district-level as-semblies are career civil servants that were nurtured under the predatory

and corrupt New Order system (Hadiz, 2004b: 621; Malley, 2003). Nowthat the opportunities are more lucrative, it is unlikely that these individualswill change their often corrupt ways (Hadiz, 2004a, 2004b). Furthermore,the continuing dominance of political parties often works against the inter-ests of small-scale minority groups. During the New Order, political partieswere dominated by an urban-based elite as they were only allowed to be ac-tive at the district level and above. Rural-based indigenous minorities wererepresented inadequately, if at all, in these political parties (or in civil ser-vice bureaucracies) and many continue to be under-represented. This lack ofconnections with established political parties and existing bureaucracies hashindered their ability to take part in the new political environment createdby decentralization. Moreover, Indonesian bureaucrats, as well as district-level political elite, generally look down on indigenous ethnic minorities as

primitive people who need to be brought into the mainstream and thebureaucrats believe they know how best to achieve this goal.

New Districts and the Rise of Localism

Outside of the fiscal and corruption issues raised above, one immediateresult of decentralization has been a drastic increase in the number of dis-tricts across the archipelago. Prior to 1999 there were approximately 168districts and municipalities in Indonesia; by November 2004 that numberhad increased to over 440 with many more on the drawing board. As dis-tricts become smaller, local minorities will have a larger say in policy deci-sions, and play greater roles in local government. They may even become

local majorities. This new majority status can have serious ramificationsfor other ethnic and religious groups in the district. Many people on thelocal level throughout the archipelago have interpreted regional autonomyto mean giving priority to local people in a district at the expense of out-siders, whether migrants or smaller ethnic or religious groups. New in-digenous majorities can pass legislation that ignores migrants, or in somecases attempts to remove them (Rawski and MacDougall, 2004). In someplaces, local people have begun to argue that only sons of the region (putradaerah) should be given political office or coveted administrative positions,in essence condoning ethnic discrimination (von Benda-Beckmann and vonBenda-Beckmann, 2001: 78; Fatah, 2005; Li, 2002). For example,inthe dis-trict of North Halmahera it is difficult for individuals of Ambonese descent(Ambon being the former provincial capital) to become the heads of district-

level offices (kepala dinas), which are powerful and potentially lucrativepositions.


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Many of the new districts have been drawn along ethnic lines and someobservers are concerned that local politicians will manipulate and exacer-bate ethnic tensions for their own political gains (International Crisis Group,

2003: 45). Van Klinken (2002) refers to this process as the rise of ethnicelites, local politicians who often use ethnic sentiments and claims on lo-cal tradition to get themselves elected (cf. Aragon, 2007; Bubandt, 2004).Once elected, however, these new leaders often turn out to be equally corruptas those they replaced, and just as dismissive of the concerns of ethnic mi-norities, even if they come from the same ethnic group (Eindhoven, 2007).Some commentators see the rise of new districts as a major cause of con-flict within districts as these ethnic groups compete over political power andcontrol of natural resources (Aragon, 2007). Others fear that redistrictingcould lead to conflicts between districts over claims to resources and theirassociated revenue streams. Scholars have blamed such disputes for the out-break of communal violence in Central Sulawesi, West Sulawesi and CentralKalimantan (Aragon, 2001; International Crisis Group, 2005; van Klinken,

2002).Ironically, regional autonomy has been touted as a panacea to ease theseethnic tensions. As local people begin to play a larger role in regional gov-ernance they can also play a larger role in conflict resolution (Laksono andTopatimasang, 2003; Permana, 2002). Newly empowered regional elites andstronger village leaders now have the ability to try and solve regional con-flicts using local custom (adat) and local forms of conflict resolution. Theselocal forms of conflict management had been weakened, if not dismantled,during the Suharto regime and replaced with authoritarian military rule. Witha better understanding of local issues and local cultures, regional officials arebetter placed to adjudicate disputes than members of the armed forces whooften come from other parts of the country and have their own interests. Fur-thermore, as decentralization makes local officials more accountable to their

constituents, they are more likely to seek a peaceful resolution to conflicts.For example, the Tobelo in eastern Indonesia are hoping that a revival ofadatand its inclusion in local decision-making processes will help prevent the out-break of future conflict in that part of Indonesia. Many Tobelo leaders believethat New Order government policies created the religion-based tensions inthe region that allowed communal violence to break out in 19992000. Theyare hoping that this turn to adatwill facilitate reconciliation between thewarring parties. However, adatalso has the potential to exacerbate tensions.The use ofadatfor conflict resolution can pose a problem in heterogeneousregions that contain multiple indigenous ethnic groups, as well as migrants(Acciaioli, 2002). Decisions regarding which adatsystem to prioritize cancreate conflict among competing indigenous groups. Additionally, migrants,many of whom often lack valid adat-based claims to their land, are unlikely

to submit their resource claims to indigenous power structures from whichthey are excluded.


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CONCLUSION

It is too early to draw conclusions about the long-term effects of decentral-

ization on ethnic minorities. In places where the legislation has been put intopractice, it has been done in a rather ad hoc and unplanned manner. For nowthe results are somewhat mixed. Some ethnic minorities have fared ratherwell, using the opportunities presented by regional autonomy to retain theirland and in some cases to regain land that had been lost under the previousgovernment. To a large degree the impact of decentralization depends on thegroup in question. A number of factors determine how groups are affectedby the new legislation and its implementation, including the potential of theirnatural resource base, their levels of political organization, and the ability oflocal leaders to work effectively and honestly within the new political frame-works created by regional autonomy. An ethnic groups ability to manoeuvrein this new political system and to engage with the new constellation of po-litical actors at the district level will determine whether they improve their

situation, maintain the status quo, or lose ground. So far, the new systemhas favoured those groups that were well integrated into the political systemprior to regional autonomy (Hadiz, 2004b; Malley, 2003). Many small-scaleindigenous groups were not part of that system. Groups that remain unorga-nized, or under-organized, such as the Punan or the Forest Tobelo, might notfare well with the new political and fiscal arrangements. Decentralizationhas often served simply to consolidate and entrench district level bureau-crats and party officials that were nurtured under the New Order regime.These individuals ignored the concerns of indigenous ethnic minorities inthe past and, unfortunately, it appears as though they will continue to do soin the future. This continued lack of accountability among district leaders,members of the DPR-D, and civil servants remains the largest problem facingindigenous ethnic minorities in a decentralizing Indonesia.

Acknowledgements

An earlier version of this article was presented at the conference Impact ofGlobalization,Regionalism and NationalismonMinority PeopleinSoutheastAsia at the Social Research Institute, Chiang Mai University; I would liketo thank participants for their comments. The research was funded at variouspoints by a Research and Writing Grant from the John A. and Catherine T.McArthur Foundation, and the Anthropologists Fund for Urgent Anthropo-logical Research, in co-ordination with the Royal Anthropological Instituteand Goldsmiths College, University of London. My research in Indonesiawas sponsored by LIPI, Universitas Sam Ratulangi and Politeknik Perdama-

ian Halmahera. I would also like to thank two anonymous reviewers for theirsuggestions for improving the paper.


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APPENDIX

Table A1. Revenue Sharing from Natural Resources According to Law

33/2004 (Percentage of Revenues Shared between Central, Provincial and

District Governments)

Producing Other District Allocated for

Central Provincial District Governments Elementary

Item Government Government Government in Province Education

Oil (after tax and levies) 84.5% 3% 6% 6% 0.5%

LNG (after tax and levies) 69.5% 6% 12% 12% 0.5%Mining: land rent 20% 16% 64% Mining: royalty 20% 16% 32% 32% Forestry: land rent 20% 16% 64% Forestry: resource rent 20% 16% 32% 32% Forestry: reforestationfund 60% 40%

Geothermal mining 20% 16% 32% 32%

Note:

Funds allocated for elementary education are divided between the province, the producing districtgovernment and other districts in the province.Source: Law 33/2004 on the Fiscal Balance between the Central Government and the RegionalGovernments: articles 1121.

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and Society: Local Governance of Forests in Malinau, Indonesia,Forest Policy and Economics

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Overview Report. Washington, DC: The World Bank. World Bank (2005)East Asia

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Washington, DC: The World Bank.

Christopher R. Duncan is Assistant Professor in the Department of Reli-gious Studies and in the School for Global Studies at Arizona State University(PO Box 873104, Tempe, AZ 85287-3104, USA). His current research ex-amines communal violence in eastern Indonesia. He is the editor ofCivilizingthe Margins (Cornell University Press, 2004).


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Documents

Christopher R. Duncan__Mixed Outcomes__The Impact of Regional Autonomy and Decentralization on Indigenous Ethnic Minorities in Indonesia

Christopher R. DuncanMixed OutcomesThe Impact of Regional Autonomy and Decentralization on Indigenous Ethnic Minorities in Indonesia